The Federal Election Commission found on Wednesday that Sen. Mike Braun violated campaign finance rules during his 2018 campaign, but after the Indiana senator provides new information he will likely face civil penalties rather than criminal.
The final audit report that the commission approved on Wednesday included less serious allegations of impropriety than the original draft report released in November.
In addition to Braun’s campaign providing FEC auditors with additional documents exonerating him of certain wrongdoing, Braun also benefited from a recent Supreme Court ruling giving campaigns greater financial flexibility.
Yet the commission ruled that the Indiana Republican overstated the amount his campaign received and spent by more than $6 million each and failed to properly disclose required information from approximately 1,363 contributors, which which means that the campaign did not include the profession and the name of the employers for these contributions.
His campaign also wrongly disclosed joint fundraising memos worth $930,000 and the correct balances and terms for more than $11.5 million in loans.
Brett Kappel, a campaign finance expert at Harmon Curran, based in Washington, DC, said Braun would likely be fined substantially. He said the violations are significant even without all of the allegations in the draft report.
“What remains are significant reporting issues, but they are important primarily because of scale,” Kappel said. “The amount of money involved is what makes them unusual.”
Braun’s campaign did not immediately respond to a request for comment, but previously attributed the errors to a former treasurer.
During the 2018 campaign, Braun defeated Democratic Sen. Joe Donnelly in a costly election cycle, in part due to millions of dollars in personal loans.
Braun’s personal loan was a ‘normal business’
A major difference between the project audit report and the final report was the deletion of a claim that Braun’s campaign appeared to accept $8.5 million in potentially predatory loans.
In the draft audit report, FEC auditors said the lack of documentation seemed to indicate that most of this money came from financial institutions “which did not appear to be done in the ordinary course of business” because there was no evidence that the banks were assured of repayment.
Braun’s campaign later submitted documents showing otherwise, and FEC auditors withdrew their allegations of impropriety, saving Braun’s campaign from possible criminal conviction.
Kappel argued that Braun’s campaign should have provided the required information earlier in the process, or requested an extension, to avoid the first draft negative audit report.
Impact of a Supreme Court decision
Braun also seems to have benefited greatly from the result of a court battle between Republican Senator Ted Cruz’s campaign and the FEC.
Originally, auditors found that Braun’s campaign overpaid the candidate in loans and interest payments immediately after the 2018 primary election. Congress capped that amount at $250,000. Braun topped that by over $750,000.
But in the end audit report, dated only days before the Supreme Court’s hard-hitting decision, the audit staff recommended that the commission refrain from making a finding due to the court case then pending.
Days later, the Supreme Court sided with Cruz in a 6-3 decision, finding that the federal law restricting loan repayment “burdens grassroots political discourse without proper justification.” Those who disagreed feared that candidates could use contribution money personally after being elected, “pose a particular danger of corruption”.
The decision also impacted a finding in the draft audit report that Braun appeared to be receiving contributions over the limit, totaling more than $1 million in surplus.
In the final report, the auditors recommended that no irregularity be found, as the court’s decision removing the repayment cap on candidate loans would make certain contributions not excessive.
Auditors felt that more than $730,000 in contributions would still have been excessive, even excluding the dollars impacted by the Cruz decision.
Democratic commissioner Ellen Weintraub lobbied to include the excessive contributions in the final report’s findings, but was shut down by Republican commissioners, in part because of the delay in the process to which the finding would have been added and concerns about whether if Braun’s campaign had enough time. answer.
For a finding to be included in the final audit report, it must be approved by a majority of the auditors. Republicans are in the majority.
“We’re still looking at over $700,000 in excessive contributions that it appears the commission is prepared to ignore,” Weintraub said during the hearing, “and I urge us not to.”
The FEC’s auditing division could send the report to a separate enforcement arm of the FEC to determine whether Braun’s campaign will face fines. The amount of the fines is not yet clear.
USA Today contributed to this story.